04-22-13 Agenda & Packet - Laserfiche WebLink

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ORDINANCE NO. AN ORDINANCE OF THE CITY OF SOUTH BEND,INDIANA, COMMON COUNCIL APPROVING AND AUTHORIZING THE EXECUTION OF A LEASE FOR THE CONSTRUCTION AND EQUIPPING OF A NEW FIRE STATION AND A NEW FIRE SAFETY TRAINING CENTER AND REGARDING CERTAIN RELATED MATTERS STATEMENT OF PURPOSE AND INTENT The City of South Bend, Indiana (the "City"), has previously investigated the necessity for the construction and equipping of a new fire station to replace the existing Fire Station #5 located at 2221 Prairie Avenue in the City (the "Fire Station Project") and the construction and equipping of a new fire safety training center located on a 5.5 acre site near Sample and High Streets in the City (the "Fire Safety Training Center Project" and, with the Fire Station Project, the "Projects"). The City has also previously investigated alternative methods for paying for the Projects. There has been filed with the Common Council of the City (the "Common Council") a petition certified by the St. Joseph County Auditor, which petition has been signed by at least fifty (50) owners of real property subject to taxation by the City and addressed to the Common Council, requesting that the Common Council enter into a lease whereby the Projects will be- completed with the assistance of a not-for-profit building corporation and leased to the City pursuant to the provisions of Indiana Code 36-1-10, as amended. The City of South Bend Building Corporation (the "Building Corporation") has been organized as an Indiana not-for-profit corporation for the purpose of constructing and leasing public improvements, including the Projects, to the City. A form of lease between the Building Corporation and the City (the "Lease") has been prepared and submitted to the Common Council for its consideration. The Lease, as presented to the Common Council, provides for the lease of the Projects for a term not to exceed twenty-one (21) years (the "Term"). The Term would begin on the date that the Projects are available for use by the City. The lease rentals payable under the Lease (the "Rentals") by the City with respect to the Projects shall not exceed $561,000 per year and shall be payable at the semiannual rate of $280,500 on each January 15 and July 15, beginning on the later of (i)the date on which the Projects are completed; or (ii) July 15, 2014. Lease rentals payable under the Lease by the City for the Projects shall be payable on such dates from Emergency Medical Services Funds received by the City (the "EMS Funds") and any other revenues made available for such purpose and to the extent that such EMS Funds and other revenues are insufficient, from a tax levy. The Rentals under the Lease have been structured such that the tax levy is expected to serve as a back-up only for purposes of marketing the Building Corporation's bonds at a lower rate of interest. As a result, the Project does not constitute a "controlled project" as such term is defined by IC 6-1.1- 20-1.1 because such Rentals are reasonably expected to be paid from funds other than property taxes that are exempt from the levy limitations of IC 6-1.1-18.5.